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7 in 10 Workers Await Benefits Info as Deadline Nears

 |  By Chelsea Rice  
   August 30, 2013

By law, employers must notify employees of health insurance benefits policy changes and coverage options by October 1. But a survey shows that 69% of workers have not yet received communications about any benefit policy changes.

Sparse information about what to expect from employer-sponsored health plans this fall is stirring anxiety among employees already challenged to comprehend the fundamentals of health insurance.

As mandated by the Patient Protection and Affordable Care Act, employers must notify employees of benefits policy changes and coverage options for the open enrollment season by October 1. But an open enrollment survey of 2,001 U.S. consumers shows that 69% of workers had not yet received communications about any upcoming benefit policy changes.


See Also: 'Dismal' Understanding of Health Plans Among Consumers


The survey, conducted by Research Now, and released Tuesday by the Columbus, OH-based insurer Aflac, shows that 28% of employees are "confused, worried, or simply unsure" about upcoming changes their employer is making to their healthcare benefits or coverage options this enrollment season due to the healthcare law.

Only 9% of companies at this time are reportedly "very prepared" to implement requirements of the PPACA. Employers' lack of preparation may be the hold-up behind the delay in communications around benefits changes, concludes the report.  

Mary Setter, a benefits broker with 29 years of experience in the industry, says many employers are still playing catch-up with their plan designs because of delays on the insurance end.

"On the small employer group side, exchanges haven't released their rates yet. So small employers haven't gotten rate information yet, and larger employers are probably just getting their renewal rate information. We're still waiting to get all the underwriting completed," said Setter in an interview.

Setter is the senior vice president of employee benefits and carrier relations at Marsh & McLennan Agency in Minneapolis. "In the mid-market employer group, July and August is when we get renewal information from insurance carriers, but for smaller carriers we haven't even gotten that renewal data yet, so that's part of the delay."

"With little notice, education, and coverage options to help guide and support [employees] during this season, employers themselves may be at risk of a highly dissatisfied workforce," said Michael Zuna, Aflac's executive vice president and chief marketing officer in a news release about the survey.  

"Employees don't really understand healthcare reform, and they don't understand the intricacies of their own plan[s], so we're seeing a lot more requests on our part to come out and educate employees on what the exchanges are potentially going to look like," says Setter.

A recent study by researchers at Carnegie Mellon University and published in the Journal of Health Economics suggests that health insurance has become so complex that consumers just don't understand it. The study casts doubt on whether consumers can even make informed healthcare purchasing decisions.

"Consumers can't be engaged in this process if they don't have basic knowledge of how health insurance works. They'll make disastrous decisions," says lead researcher, George Loewenstein, PhD, a professor of economics and philosophy at CMU.

Setter says there needs to be a larger, more long-term communication strategy that emphasizes continuous education around health insurance policies and how benefit design will be affected by reform.

"I would expect communication to be in full swing in September, not unusual timing for annual enrollment season," said Cuthbert. "Many of the employers we're working with are using this as an opportunity to let their employees know about the impact of health care reform, the public health insurance marketplaces, and potential government subsidies on the employer's plans and their employees."  

"I think that a lot of people don't understand that there's going to be a cost associated with the plan shifts in healthcare reform. Every so often we have conversations with employees that think they're going to get free coverage under the exchanges. I don't think they understand exactly what's happening. We're going to see more questions about what's covered and not covered than we're seeing today," she says.

Chelsea Rice is an associate editor for HealthLeaders Media.
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